How to Make Marketplace Website Like OLX
How to Make Marketplace Website Like OLX
This article is for those who want to create a peer-to-peer website marketplace like OLX, where any user can create an ad for the sale of their goods and services. The site is used monthly by more than 200 million users from 40 countries who conduct 8.5 million transactions, making OLX one of the largest online message boards in the world.
Step-by-step guide consists of five steps.
By creating your site like OLX, you can follow a similar path if your marketplace is focused on a region where there are no competitors. There are very few such countries (Syria, Libya, Iran, North Korea), and all of them are not yet suitable for starting a business due to the difficult political and / or economic situation. Therefore, it is better to use a different strategy - choose a niche with low competition.
Here are some examples of promising niche markets:
If you are creating your own marketplace website like OLX, you don’t have to stick to this particular business model. You have the right to choose from all possible methods of monetization suitable for such projects:
Post fee. This model is usually used on sites where people sell expensive goods and services, as well as on employment sites or dating sites. For example, Craigslist uses such a scheme, taking the minimum fee for placing ads in certain categories.
Monthly subscription. Users must monthly pay a certain amount for using the platform. Money can be taken both from those who publish posts (as they do on sites selling cars, real estate, land, services), and on the other hand (as they do on dating sites and wholesale markets). Some marketplaces require a subscription only for those who sell a lot. The subscription model is used by eBay, Amazon, Skillshare (training courses), Workaway (vacancies) and LinkedIn.
Google Ads and AdSense Ads. This approach implies free access to the site and the sale of some site space to third-party advertisers through integration with Google Ads and AdSense Ads. This model was chosen by OLX and Quikr, it is especially popular in new projects.
Advertisements. These can be banners on the main page, at the top of the natural listing, or in recommendations. The difference between this option and Google Ads is that such advertising is completely controlled by you and you will not share revenue with third parties (for Google Ads, this is Google).
Sales commission. The most common way to monetize the marketplace. Payment is taken only in case of a successful transaction. Money may be charged to the seller, buyer, or both. EBay, Amazon, Airbnb, Uber and most other well-known marketplaces work on this principle.
Premium features. This model implies free use of the site with the ability to connect additional paid features. For example, the removal of all advertising, a special design of ads, advanced statistics, integration with external services, storage of goods and more. This model is used by Tinder (yes, this is also a marketplace), OLX, Amazon.
It’s not necessary to use only one way of earning money; they can be combined, as OLX and Amazon do, by charging a commission from trade transactions and earning on subscriptions, premium features, advertising, etc.
In all countries, business requires registration of a small business or legal entity. The type of permit, speed and price of such a service depends on the jurisdiction, business profile and size of the business. You need to register a company in advance, so that by the time the marketplace is launched, you can immediately start a legal business.
Ready solutions. WordPress themes or free open source software will allow you to quickly create your website for minimal money. In the case of WordPress, you don’t even need to have coding or web design skills, just buy a hosting, connect and configure a theme. Such topics can be free or sold for $ 50-1,000.
White label solutions. Ready-made software with minimal setup. In fact, you just buy a ready-made service without marking, which is usually connected to a common backend. The difference from WordPress is that white label products are regularly updated and have technical support.
Cost: a subscription costing from 20 to 10 000 dollars or a one-time fee - from 500 dollars. There may be a combination: a large payment at the beginning and the ability to connect updates and technical support by subscription.
White label disadvantages:
Development from scratch. In this case, you or the hired developer company are responsible for the entire process of developing the site. It is longer, more expensive and more difficult, but you won’t overpay for the extra functionality, you will be able to develop a unique design and keep the copyright for the created software.
Estimated cost of creating a site like OLX is:
Note. Regardless of the development method you choose, hire programmers who will connect hosting, an SSL certificate and configure the site correctly. This is especially important if your site will be responsible for financial transactions between users.
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